Amazons new headquarters in downtown Seattle.
Amazon's new headquarters in downtown Seattle. Charles Mudede

Much of the blame—maybe too much—on the rising costs of living in Seattle has been placed on Amazon and tech workers. But the source of the major housing issues Seattle faces will eventually prove not to be in the sectors of production (Boeing) or distribution (Amazon) but in finance. We pick on Amazon because, despite being a tech company, it is a visible and hard entity. Finance capital, on the other hand, is as substantial as gas. A tech worker is, after all, still a worker; but who, what, or where is this rentier, the ghost in Seattle's transformation?

During the '90s, Seattle also experienced a burst of economic growth related to the tech sector and factory production. But this did not make the whole city super-expensive. What's the difference between then and today? For one, Seattle was just one among many cities and regions in the 1990s and much of the 2000s that were performing well, and so was mostly indistinguishable. But after the crash, Seattle became one of the few cities in the United States that recovered steadily and predictably. As a consequence, it became visible to world-class investors with lots and lots of surplus cash.

What many average Americans have a hard time realizing in the age of austerity is that the scarcity of capital is not real but imposed. Most of us and the governments that represent our interests have little or no access to this surplus cash. But the fact that it's hard to obtain does not mean it does not exist. It does, and in vast amounts. Not only that, this kind of cash has a problem that seems hard to believe: It struggles to find investment opportunities.

Now, as standard Americans, we believe that there are lots of business and entrepreneurial possibilities all of over the place, even in our garages. So how could this really be a problem? The returns on productive and distributive activities (called profits) are not high enough. This is why investors in a major business scheme are always keen for the enterprise to make a public offering. (For more on this, read Mariana Mazzucato's Entrepreneurial State.)

This is a problem not only for greedy rentiers (people who live off of investments) but also pension funds, which can only fulfill their promises if the return on capital is at 8 percent. Right now, safe investments (such as government bonds) usually yield below or around 3 percent. (For more on this, read Martin Wolf's section on banking in his excellent new book The Shifts and the Shocks.)

What's the solution? Inflate assets in the form of property. This is the situation Seattle is now in. It has become a world-class city because it's offering a solution and to a world-class problem: surplus capital.

This is from a May 5 press release (PDF) by Los Angeles-based CBRE Group, one of the world's largest real estate investment firms:

Seattle is emerging as major global destination for capital, ranking at number nine on the list of top ten global cities for commercial real estate investment, according to CBRE’s Global Investor Intentions Survey 2015. Seattle is one of three U.S. West Coast cities in the top ten, with San Francisco at number three and Los Angeles at number eight. London retained its position as the top city for investment, while other gateway cities such as Tokyo, Sydney, New York and Paris remained in the top ten.

Second-tier cities saw an increase in investor interest in 2015, with Madrid and Dallas making the top ten, in addition to Seattle. This reflects investors’ search for more attractive yields, as well as greater knowledge and comfort with a larger number of global cities.

The language could not be any clearer. We spend all of our time complaining about NIMBYs and tech workers and almost ignore this radical transformation of the city's capital structure.

What is the future of Seattle? Today, the financialized city has its terminal point in London's "Billionaires Row."

A Guardian investigation has revealed there are an estimated £350m worth of vacant properties on the most prestigious stretch of The Bishops Avenue in north London, which last year was ranked as the second most expensive street in Britain.

These homes are inhabited only by money. People do not live in them because people can't afford them. These are dwellings for the world's surplus cash.